Busted: Bankers and The Global Economy

August 16, 2010

The Disingenuous Timothy Geithner

On a very regular basis, Treasury Secretary Tim Geithner engages in magical thinking with deliberate attempts to delude American workers into believing that business investment and consumer demand are on the uptick. Geithner’s pretense isn’t only disingenuous and disrespectful, but dangerous. How? He continually suggests  that American consumers should feel comfortable borrowing and spending in the vain hope of spurring any hope of economic bright light.

Mr. Geithner needs to stop with the tim-foolery as these truths hang over our nation like a plague:

  • The real unemployment rate is 18.3%, instead of the 9.5% rate the administration uses.
  • The number of real unemployed workers in all four categories of unemployment is no less than 29.3 million, instead of the administration’s one-category-only figure of 14.6 million.
  • In real terms the all-important “jobs gap” is 21.3 million new jobs.
  • Since the start of the Obama administration, the number of real unemployed workers has increased by 4.6 million. The U.S. economy needs to add 150,000 new jobs each month simply to keep up with “population growth.”
  • For unemployment benefits, the average number of weeks unemployed is at least 34 and the number of workers unemployed a half year or longer is at least 10.1 million.
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May 12, 2009

Wall Street Giddy with High Times to Come

economic crisisWe live in exciting times. The stock market is up 100 points… or who knows what goodness corporate investors are blessed with today. Wall Street mavens and financial wizards are feeling giddy with delight. They want good times so badly that they are already deluding themselves that the recession is over and that runaway prosperity is in the wings. It’s time to start making money all over again the way “we” used to. After all, nothing has changed beyond massive cast infusions to hold up the system. Multitudes of banks, corporate mongers, financial wizards and wishful investors are convinced that we are about to relive heady good times without an ounce of reform or correction in the system that jack built. They may be right.

bear stearns collapseThe longer reform takes, the less likely reform is to happen, at least if financial and corporate simple simons have their way. It’s time to stop pretending that the Wall Street economy is the same as the real economy that everyone lives in. Wall Street hasn’t met with total and final meltdown because the Wall Street economy has been rescued. They have lived to see another day because of government bailout, presumably at taxpayer expense. Yep, Wall Street seems to be showing signs of life along with the giddiness that goes along with having a future without any reform or consequences. A real party is set to ensue at the expense of all. The real economy that the rest of America lives is another matter altogether.

What is truly important where the economy is concerned is whether real Americans can find work. If Americans can’t find work or create work that they use to survive, the country is in trouble, pure and simple. 539,000 Americans lost their jobs last month after many months of ongoing successive unemployment disaster. Since the recession officially began in December 2007, 5.7 million jobs have been given the write off by government employment statistics. The reality is actually even worse.

Still, there has been plenty of impressive talk about the new world of reform that America will enjoy, but little has been done beyond the talk. Regulatory reform is dying on the government vine of important projects.

Geithner has quipped, “We are being dramatically more aggressive than I believe any serious government has ever been, certainly in generations, in responding to financial crises. So if you look at the scale of action, look at the quality of initiative we’ve taken, I think it dramatically exceeds even the best-managed crises we’ve seen before.” Ple-e-ze. The system continues just as before, but without any reform or any real ideas for reform that hold any substance. The Masters of the Economy can’t seem to wrap their minds around the banking deluge that has brought us to our knees, much less figure out a way to reform it. They just don’t want to rock the boat of monetary largess. Geithner told Congress that fixing the system would be accomplished not by “modest repairs”, but by “new rules of the game.” I agree that what is playing out between government, corporate bankers and central bankers is a game. That much is obvious.

People are watching. Are you? ~ E. Manning

March 29, 2009

Geithner Admits Fed Role in Economic Collapse

geithner charlie roseThe Obama administration wants to add a glimmer of hope to the global fiscal crisis that started with corrupted U.S. corporate policy and banking investment greed. Despite efforts of many to put lipstick on the ongoing economic recession and remove blame from corporate bankers and government, in a recent interview with Charlie Rose, Tim Geithner admitted

“a deepening recession. You’re seeing the recession intensify here and really around the world. You know it started here, but the world is sort of catching up. That’s putting more pressure on business and the financial system as we see it. We start with this deepening recession, intensifying housing crisis, a deep fiscal hole in the financial system that’s in some ways very damaged. Parts of it are working well, parts of it are still very damaged. It’s going to take a lot to work through this. Again, we start with a — just a deep mess. It is our obligation to clean it up and to fix it…”

“I want to be clear. Again, we start with a mess, a deep mess, made worse by the deepening recession. And these things are pitting on themselves. And it’s very important for people to understand, it’s going to take some time to work through this. But what I want people to know is that we’re going to do what’s necessary to get through it. And these things will get traction. They will start to help unfreeze things, and they will help lay the foundation for recovery.”

“They (the Fed) projected that optimism in the future and that created the conditions where people took more risks than they should have, and they, frankly, didn’t pay enough attention to the possibility that when this ended, came apart, that the consequences would be as damaging as they did. Now, I spent almost every day from the first time I walked into the New York Fed about five years ago working with my colleagues on ways to try to make the system stronger so we were going to be better able to withstand the kind of pressures when this came apart, and we did some very important, powerful things, but many of the things didn’t have enough traction, and we share with really all parts of the financial oversight bodies here and around the world a deep responsibility for not having done more and a really deep obligation for trying to fix this quickly and put in place the kind of reforms to prevent this from happening again.”

“Our system was not designed to sustain a shock, a crisis of this magnitude. It’s the tragic failure of financial regulation in this country. It was just not designed to tolerate anything of this magnitude. The critical test of any financial system in some senses is how you deal with stress and shock because you want a system that’s going to be strong and resilient enough to handle almost anything it could face. And this system didn’t meet that test because we had a regulatory framework that was designed, largely, 90 years ago and did not adapt to take account of these huge changes in the structure of our financial system.”

January 26, 2009

Economy and U.S. Treasury: A Dilemna of Principle?

geithner-for-treasury-secretaryThis afternoon the United States Senate will vote on Tim Geithner’s nomination for U.S. Treasury Secretary. He has been hand-picked by the Obama administration from the Federal Reserve. In a poll by American Solutions for Winning the Future, those participating in the poll thought of his nomination in light of his tax mistakes. With more than 83,000 people responding, an overwhelming 98% of those polled voted to oppose Geithner.

geithners-furrowed-brow2Is it wrong for someone who failed to pay $34,023 in taxes to become Treasury Secretary in charge of taxation and economic policy application? As U.S. Treasury Secretary, he will be in charge of administering any future bailouts with government funding through the taxpayer. American Solutions says that this is about principle. If Geithner is approved, will he will be a symbol of ‘favoritism’ and ‘rich politicians’ getting a different deal than the rest of us? Or perhaps Tim Geithner is someone just like you. He makes mistakes. Should Tim Geithner have a higher level of accountability than the average American citizen? Do we really want a crossover from the Federal Reserve in government administering your money? Is this a government buyoff to give the Federal Reserve more power in exchange for continuing support and funding from central bankers? What do you think? ~ E. Manning

January 9, 2009

A TARP Bailout Program for Consumers?

furrowed political brows

furrowed political brows

The failed U.S. TARP bailout program legislated by the EESA last year has been ungoing review by the Obama Ascension Team and the likes of Treasury Secretary-elect Timothy Geithner, former Fed member and sycophant. Furrowed brows and eye bags have become a way of life in politics. Managing the program has become an impossible and failed task. President Obama will be responsible for determining what to do with the remaining unspent TARP funds. The Obama Team is examining ways to expand the government program to generate loans to municipalities, small businesses and consumers.

Many in Congress seem to agree that the existing government program should be revamped rather than refunded. Many elected officials agree that the remaining money should be used to stop the national foreclosure crisis instead of a continuation of current policy where Wall Street firms receive continued assistance to pay bonuses to executives and dividends to shareholders as promoted by the Bush administration.

monopoly-moneyAs if the U.S. needs yet more government agencies, Geithner is considering creating a new bureau within Treasury to oversee the existing TARP funds. Adding oversight personnel to government measures has proved to be a failed premise, especially since any provision lags far behind the need. Any potential for work backs up due to lack of staffing, if staffing is ultimately provided over the long haul. Such provisions are more like a governmental agency employment and monetary ponzi scheme than professional organization. So far, overseeing TARP funds has been a disaster, largely made secret because of banking bailouts.

Meanwhile, banks in Britain are laying off staff while bringing malleable interns into the fold as underpaid and temporary junior staff, a move that could catch on in the United States: a cost-saving and control-oriented corporate move that has been all the rage outside of banking. British banks are counting on business picking up after the recession, rationalizing that young blood needs to be on tap for the occasion. Swiss-owned banks are notorious for this practice.

be an intern

be an intern

Corporate America has caused the economic crisis and now that they have been bailed out with taxpayer money, are seeking to continue to take advantage of people with the damage they have caused. Government seems to back up this thinking, which is ultimately destructive rather than constructive. Self-serving behavior continues unabated in government and corporate life. Now that truly is worldly wisdom at its’ worst. Anyone that chose to run personal finances in the same way wouldn’t last long, hence the benefits of corporate/governmental leveraging and power borrowed from the taxpayer.

Whether the American taxpayer can possibly benefit from all the confusion remains to be seen. ~ E. Manning

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